Another post had been written being a simulation of crisis and preparedness. I found that post to be very thought provoking but it was also based on some extreme events such as a terrorist attack and EMP. No offense to the author of those posts, but I wanted to try to visualize what life could be like if the economy and life continue as they are and eventually come to a crisis without a major catalyst such as a terrorist attack. I wanted to try to put myself in the shoes of the average hard-working American that isn't into all that "conspiracy" stuff but works hard to pay his bills, put money into his 401K and live his life the way he was brought up to live it thinking that the government would take care of him and his family. I wanted to show how quickly things can escalate and how a little bit of preparation could mean the difference between life and death.
June 5, 2011The world as we know it doesn't seem much different today than it has for the past several months. There are the typical threats of terrorism and talk of war around the world but nothing serious. Prices keep rising slowly but surely.
Gas: $7.40 / gal.Gallon of milk: $7.99Big Mac: $6.991 month electric bill: $7001 lb. ground beef: $19etc....
We try to drive as little as possible. I am able to work out of the house so I don't have to buy too much gas. We live about a mile from the Super Wal-Mart so we don't really have to go out any more than that. We buy groceries about every two weeks and fill the SUV to the brim with them. We spend about $1,200 everytime we go. That's all we can afford. Between utilities, health care, taxes and groceries, we're living paycheck to paycheck. I wish we had enough money to start a savings account for a rainy day but we just can't. We eat a lot of rice and beans these days. Ramen is still cheap but meat is very expensive. We've been talking about starting a garden now to help with the cost of food and also to get a little more nourishment but we don't know where to begin.
Our monthly budget:Food: $2,500 (Once a month I take the family out to McDonald's. It costs the 3 of us $45.)Gas: $50Internet: $125Phone: We don't have a phone or cell phone anymore. We use Skype for all communications now. The good thing about it is that the creditors can't call us anymore. =)Cable: $185 (I don't know how we could live without cable. We don't go out anymore so TV is about all the entertainment we get.)Gas/Water/Elec: $1,200Mandatory government healthcare: $1,500
Monthly income (insurance salesman): $12,500Total monthly budget: $5,585Income tax withholding: $6,915 (45%)
Thankfully, I got a raise last week. It was a pretty substantial raise, 10%, so I am not hurting as much as some I know. So now instead of getting $150,000 per year I get $165,000. That will give me roughly $700/mo. after taxes and should help a little. My wife and I used to consider ourselves upper-middle class. Now I feel it is a stretch to call us lower-middle class. How can we be middle class if we're living paycheck to paycheck? I stopped paying into my 401K a while back but at least it is worth $450K right now. In just 14 more years I'll be able to cash it in.
My wife hasn't worked in over a year but it has given her time to stay home and take care of our 4 year old son. We wouldn't be able to afford day care or the gas right now even if she was working. In fact, most day care centers around us have closed down. My brother lost his job about 6 months ago and hasn't been able to find more work. He foreclosed on his house a year earlier and thanks to a government program he was able to stay and pay low rent for a year but that has ended and so has his employment. He has since declared bankruptcy and moved in with us. Luckily it is just him but he has no income and that's just one more mouth to feed. He does get a couple of hundred dollars worth of food stamps each month but he uses that to buy junk food or things he shouldn't then mooches off of us for real food. He mostly sits in his bedroom all day on the Internet or watching TV. We hardly see him. My sister, her husband and their 2 grade school children are facing a similar crisis right now. We're quickly running out of room in our 4 bedroom house. I think I should go buy some cots. I don't even want to think about my parents and the in-laws. We just don't have the room or the money to take care of all these people.
The government reports the unemployment rate at 19% but that number seems low. I know too many people not working right now. Luckily the government is forcing people to buy insurance so my job at the insurance company I work for looks safe for now. Still, I don't know how most people are surviving. Even those that have work can barely afford to feed themselves. I guess the government assistance programs are keeping everyone else alive.
September 10, 2011Tomorrow is the 10th anniversary of the terrorist attacks on the World Trade Center. That seems so long ago. Nowadays, I'm wondering if the terrorists were right. Our government is running this country into the ground at an unbelievable rate. Just last week they announced a new increase in payroll taxes so the current tax rate is 60% for middle Americans. That raise I got a few months ago is now gone. It was really getting to the point that I really needed it too as prices of everything keep going up. We are spending more at the Wal-Mart these days and we seem to be buying less. We are definitely going to have to find ways to trim our budget. Not the cable TV...not the cable TV... The government is talking about subsidizing cable TV so maybe we'll all be able to get it for free from now on? I can only hope.
September 21, 2011We went to McDonald's last night for our monthly meal. It cost us $62. I noticed that they don't even bother to update the prices on the menu board anymore. They said that they got sick of changing it everyday.
I've been begging my boss for a raise all week and he seems to be getting annoyed with me. We are on such a tight budget right now I don't know what else to do. He says that the company is barely afloat and cannot afford raises. More and more people each day are late paying their premiums and the only reason we haven't gone bankrupt yet is because the government keeps giving us money.
I saw on the news last night that the crime rate is going up at a phenomenal pace. The police can't keep up with it all. We are lucky out here in the suburbs that we don't get too much crime. I was thinking about getting a gun but my wife just won't have one in the house.
November 1, 2011Last night was halloween. We didn't even bother to take our son out to go trick-or-treating. We only had 3 kids knock on our door anyway. I gave each of them a few peanuts. My wife was not pleased with me. She said they could get their own damn treats.
She tells me now everyday that we should build a garden. I've tried to explain to her that we don't know the first thing about growing a garden and it is almost winter now so it doesn't matter anyways. Our food rations are getting smaller and smaller everyday. Just a few years ago we had a full pantry with all kinds of foods that we never seemed to touch and they're all gone. Breakfast is usually half an egg and some toast. For lunch we'll have either some pasta with a smidge of spaghetti sauce or perhaps some white rice and pinto beans or a little bit of canned tuna. We try to save the vegetables for dinner so we usually make some sort of soup with whatever meat and veggies we have. We don't have anymore spices except salt and pepper but that's really about all one needs. My wife says that our monthly outting to McDonald's is permanently on hold. Food is getting so expensive that we keep having to cut back. It's not so bad, though, I am getting used to being hungry. I think my stomach is getting smaller and I've lost a lot of weight. I haven't been this thin in 20 years.
It really bothers me, though, that others get to go to McDonald's or another restaurant everyday because they don't have jobs and the government gives them food vouchers but since I do have a job to slave at everyday my family gets to eat rice and beans. I pay roughly $9,000 / mo. in taxes and my brother hasn't earned a dime in forever and gets free food and a place to stay. My wife yells at me daily about him. He's famiily so what can I do?
November 15, 2011On the news this morning they said that riots have broken out all over the country. Apparently the government food vouchers did not get mailed this week and everyone is going crazy. I tried to log in to my company's VPN to start work this morning and I cannot get on. I sent an IM to my boss and he can't get in either. I don't even know now if I have a job.
November 16, 2011We were supposed to go to Wal-Mart last night for our bi-weekly food run but we were afraid to leave the house. We don't have much food left to eat and we really need to go. My wife is sure things will calm down in a day or two after the National Guard gets mobilized.
The news just reported that the US dollar has collapsed. I'm not really sure what that means. The news is speculating all kinds of things but no one really knows what is going on. We have $3,000 in the bank that we were supposed to take to Wal-Mart. Now I don't even know if I can use it. I guess that 401K isn't going to do me any good now either.
They're saying that riots are spreading quickly from the urban areas outward. We're about 25 miles north of the city so hopefully they don't come this far. I wish I could learn more but the power keeps going out. It goes out for about 20 minutes and then comes on for about 20. I've got a baseball bat and my brother has a golf club. That's about the only defenses we have but it really doesn't matter since we don't have much food here anyways. There's nothing to take.
My next door neighbor just came and asked us to watch their place. They're getting out of town and heading up to her parents' place. They have a big piece of land in the country and they think they'll be safe there. I told them to hurry because the National Guard just placed a nationwide curfew after dark.
November 17, 2011We haven't left the house. The rolling black outs are getting worse. We get about 5 minutes of power every hour. Whatever news we can get doesn't look good. Just about every store in America has been looted. There is no gas available for the trucks to deliver goods. Not that it matters since there is no one willing to drive them because there is no money. The weather is getting colder and our gas stopped working last night. We have to huddle up together under the blankets at night. The water still works but it has a very peculiar odor to it. I'm afraid to drink it. We were boiling it for the past couple of days but now that the gas doesn't work we won't be able to do that. We have a little bit of bleach so we're going to try putting some water and bleach in some buckets. We're afraid the water could be shut off at any moment. What little food supplies we had are almost gone.
I feel so bad about it but I broke into my neighbors' house, the one's that left yesterday. I have to feed my family. It turns out they had all kinds of food. I found a can of black olives, some crackers, a whole bunch of uncooked pastas, some minestrone and a few other soups, a can of artichoke hearts and some other things that used to go unused in my pantry too. I guess they were too good to eat this stuff but to me it's a goldmine. We're having a feast tonight.
I've seen riots before but what is happening right now is scary. I've seen the National Guard troops going throughout the neighborhood and it seems like they're rounding people up. I don't know what for but the neighbor behind me said they knocked on her door and when she answered it they barged in, without a warrant, a took her husband. They didn't even explain why. I've known him for years. He's always been the type to speak out against the government and talking about conspiracies and whatnot. His wife thinks that's why they took him. The smell of smoke is thick in the air and there's a dark haze over town. I caught a glimpse on the news before the power went out again of what looked like concentration camps. Perhaps that's where they took my neighbor.
March 2, 2012This is the first time in months that we've had power and an Internet connection long enough for me to update my blog. Things are starting to stabilize now but calling life over the past few months hell doesn't even begin to explain the harsh reality. The important thing is that my family has survived. Too many others weren't so lucky. I've been told that many millions of Americans have died over the past few months from the riots, starvation, freezing, sickness or, the worst, the death squads. That's right. Those people, like my back neighbor and my brother, were taken to the camps and eventually put to death for crimes unknown. Mr. Obama tells us that it was for the safety of all Americans that these "traitors" be executed.
Back in late December we were told to go down and register for our new money IDs. When we showed up they injected something into us. We were told that it was an injectable chip that would track our money from now on and we would no longer need cash. Those that refused were taken away and haven't been seen since. On January 2 they went into effect. Every American was given an allotment of money based on a number of different criteria. Almost immediately things calmed down. The first thing we noticed was that the power stayed on. It wasn't long before food was being delivered regularly by non-military trucks. There are government sponsored work programs being advertised everyday to "rebuild America". I went down right away and signed up for a job working for the roads dept. I get 20 Ameros per day, which isn't bad considering I can buy a gallon of milk for just 1 Amero.
You may be wondering how we survived until then. Well, my brother finally decided he was going to pay us back for all of our hospitality. Back in the beginning of December he met up with a group of people that claimed to be a militia. They gave him some guns and together the whole group ambushed a food convoy. He was able to aquire several crates of Army food rations. He stored them here and 2 days later the Dept. of Homeland Security showed up and took him away. We haven't seen him since and we assume he is dead. They interviewed my wife and me for several hours and decided that he acted alone and that we were not any real threat. They confiscated his stash from his bedroom and searched the house. Luckily, they did not search the storage shed in the backyard where I had been keeping most of my supplies. I had made a trap door in it and stuffed a box under the shed. This was to keep my brother and any possible "friends" of his from finding it. That food got us through the winter until our Ameros kicked in.
I started sleeping during the daylight so I could stay up at night and keep watch. I used one of the guns my brother had gotten and patrolled silently around the house all night in the cold winter air. Things were so eerily quiet back then that you could hear sounds from miles away. There wasn't a night that went by that I didn't hear gunshots followed by people screaming. On 3 separate occasions I saw people approaching my home in the middle of the night. Luckily a couple of warning shots was all it took to make them go away.
I've not heard from anyone else in my family. My sister, mother and father, my wife's parents. We don't know if any of them survived. But we did and, for me, that's enough.
Great writing. With all of these catastrophic scenarios, maybe a paradigm shift will emerge and the realization that having a monetary system is totally irrelevant for our current system. And the new era of creating abundance, sustainability, and efficiency will emerge. If the monetary system paints such an ugly picture in the end, then it's time for money to end unless we truly want to destroy ourselves.
Yes I am talking about a Resource Based Economy. And yes a RBE uses no money of any kind.
If the idea of not having a money system is upsetting to you, then ask yourself, "do you think heaven uses money?" If heaven is such a praised place by most religions, you honestly think a monetary system exists there?
Is it the American mentality that couldn't adjust to such a shift or is it the entire world? Or will the "Establishment" do anything and everything to maintain a monetary system in order to keep that debt noose around our necks?
This is the simulation that I wanted to present, but I couldn't think my way through it. You did a fantastic job!.
I haven't given much thought or research to the hyperinflation scenario, because I personally don't think it is likely, but neither is an EMP attack I must admit.
Interestingly enough, both scenarios result in similar circumstances.
Its very depressing to contemplate this stuff, much more so to actually write it down. Thanks for doing it.
You know I have to disagree with your SHTF scenario and here is why:
The Federal Reserve will PANIC the moment prices begin to rise 30% per annum. At that point they will shut off the money faucet and let deflation reign. Remember that this is a CREDIT LED RECESSION not a inventory or over supply recession. Even housing is not oversupplied but rather a function of too much credit in the hands of consumers. The 53 trillion in debt outstanding can easily get sliced down to 35 trillion putting the US in a deflationary hell hole. If consumers, states, corporations, and gov were not in debt then perhaps hyperinflation could be possible. But since asset values are dependent on credit, they will deflate due to the lack of credit. Moreover, for a hyperinflationary scenario to ensue the big banks would have to be bigger and would have to start lending to people with bad credit in order for prices to continue to rise. Eventually, falling wages would hit a brick wall with debt defaults and deflation will continue.
Bernanke would have to literally give people a check for 50k each in order to have hyperinflation.
Wow, great writing, Keelba! You must write for a living! It seemed very realistic, given the overall scenario you were assuming of a slow downhill slide. However, since November 2007 when Jim Sinclair first declared, "THIS IS IT!" things have gone pretty much as he predicted. If I understand him correctly the slow slide into hyperinflation started this month, November 2009, hyperinflation based upon the failure of the currency -- nobody wants dollars -- not due to the increased money supply or higher prices. I see hyperinflation starting as a slow slide but eventually going faster and faster. I believe the end will come suddenly. Now whether "the end game" includes anarchy or a new currency or a drastic and sudden debasement of the dollar I have no idea. Anyway that's my best shot. Of course, no one in government will acknowledge blame for this economic disaster. Instead the government will be pointing to various scapegoats as responsible for this disaster.
Great writing, very realistic and a true possibility.
...personally don't think it is likely, but neither is an EMP attack I must admit....
JAG, an EMP threat might be a little more likely than one might think. Especially if an "attack" was targeted at destroying a whole society. Just one or two low yield nuclear weapons detonated at altitude (magnifies the EMP effect) above the US would be EXTREMELY devastating. Read William Forschten's One Second After. It will make your gut cringe.
It's interesting to hear different people's reactions to this. This story, as the title states, is pure fiction. I guess what I get from this or what I wanted to convey were two things in particular:
First I wanted to paint a picture of Chris Martenson's magic water drop and demonstrate how quickly things can happen. If you wait until you know there is a problem then it will probably already be too late to do anything about it. I know too many people today that choose to remain ignorant. Like the guy in the Matrix these people want to choose the blue pill. If they get any indication that the knowledge I want to share will change their perception of their world they will tune out and shut down. But their personal feelings and desires will not change the outcome of the world and sooner or later they will have to deal with reality or else reality will deal with them.
Secondly, I wanted to demonstrate how even a little bit of preparation can go a long way. In this scenario, imagine if the family had a few supplies like some batteries and a transistor radio, some extra blankets and firewood, a water purification system, or a few hundred dollars worth of dry goods to store in the garage. What would these things cost in total? A trip to the Bahamas? A plasma TV? An XBox 360 and a few games? Yet just any one of these would have made a major difference in their lives during the crisis but instead the guy in the story believed in the lies he was being told right up until the end. He clung to "the old ways" in which he was brought up and thought things would go back to that. If he knew that "the next 20 years will be very different than the last 20 years" he might have done something different while there was still time.
I don't know if it does any good to analyze the type of disaster or how the disaster unfolded. After all, I wrote the whole thing in 30 minutes and didn't put too much thought into it. Instead I hope people can visualize a realistic crisis now so they can start dealing with it now. I don't think it really matters if it is deflation or hyperinflation. Either way the not-too-distant future is going to have some very serious challenges.
One thing I am sure of, however, is the fragility of life as we know it in America. We learned when hurricane Rita struck Galveston that in just 2 days of the announcement that Rita was coming, the store shelves and gas stations were empty. Our lives, with our just-in-time retail policies, depend upon a constant stream of shipping and fuel. That system can break down within a matter of days leaving many, many hungry and motivated mouths to feed. I lived in Los Angeles in April 1992 and saw first hand the American people at their worst. There is no explaining riot mentality but once it kicks in, an entire society will break down within a matter of hours.
I'm not sure where to post this but since this is the thread that got me thinking of it, I will post here. Despite bearmarkettrader and hucklejohn's posts disagreeing with this scenario playing out, it seems to me this is the preferred method for TPTB - a slow ruin of everyone's resources and resolve till finally we welcome their handouts, ameros and injectable chips because we can't stand to see our children hungry anymore. Whether it happens by inflation or deflation or a big part of the population being sickened to weaken all of us; at this point we are all guessing and trying to be two steps ahead of them. Yet, what good will those two steps do? It sounds like there are some here who will be able to hunker down and even thrive, due to land and community, but most of us seem to be talking about merely *surviving* until ... what? I live in earthquake country and when we put stores aside for a few days, it is with the idea that after that time things revert back to normal. However the one thing everyone seems to agree with at this site is that, no matter how it looks in the future, it will definitely not be "normal" as we know it ... and nobody is saying anything about it being better.
I had a long, rambling post and decided to spare you all. I suppose what I'm thinking is that part of preparing for the future is anticipating what can be done differently so that the society that rises from the ashes (so to speak, hopefully not literally) doesn't repeat the same mistakes. I'm not sure I'm anxious to merely survive and feel lucky that my children are at least alive to eek out a livelihood in servitude. I would much prefer that if their lives are different, they are in most respects better - by this I do not mean they are among the evil elite living off the work of others. But that they are part of a community, removed and separate from the fallen empire, that thrives on a different way of living. Is there a way to create something like that while we still have dollars to work with and we can still communicate over vast distances? Is it even possible that people would be willing to relocate to create such a community? And if there was and it was created, what should be done differently so that we do not recreate this same scenario two hundred years down the line?
I disagree. That would not be enough.
Very excellent scenario! Thank you for sharing!
This type of scenario scares me more than a catastrophic failure. At least in the catastrophic failure you have a bit more supplies stored and you must change your life. This scenario moves slowly, little by little taking your resources away, your rights away and your humanity away.
Like the frog in a cold pot of water with the heat rising little by little. Once you realize you are in trouble, it is way too late.
So I wrote this back in Nov. 2009. I just heard the mainstream news last night talking about how we should get used to the cost of everything going up significantly in the next few months. It's amazing to me how well I timed things so far in the quick story I wrote. So maybe we won't hit $7/gal. gas by June but you can see how things are escalating substantially and quickly right now.
The story above was written from the point of view of the average American, Joe the plumber types who will not see things coming ahead of time. They will only react to things as they happen. What happened in Egypt and what is happening around the Middle East and even in Europe should be a wake up call to all of us right now and yet, so many people I talk to still think nothing like that can happen here in the US and "Western" countries. They believe we have hit bottom and things are only going to get better.
Maybe things won't be as bad as they are in my story. I certainly hope they don't get that bad but I think it is safe to say that "the next 12 months are going to be very different than the last 12 months." I believe the mainstream media is purposely softening us up right now for what is to come.
March 2, 2012
Like the first time I read it, the first paragraph is the most sobering and saddening. Since it seems like this is the end goal of TPTB – a submissive population that is happy to just be able to eke out an existence – then they will have won; and at this point we will be too tired, scared, scattered, unorganized and without resources to resist. The second paragraph is also heartbreaking ... how many of us could say that right now and be content? We couldn't and wouldn't! But after months of living in fear and starvation will we be at that point?
This scenario moves slowly, little by little taking your resources away, your rights away and your humanity away.
We are already seeing our rights trampled on and we are aware that our resources are being squandered and QE'd away. Is it that our humanity is already gone that we find ourselves unable to resist? Or has the Dumbing Down of America been so effective that the above hasn't even registered yet?
This is longer, but more realistic I believe...... found this about four years ago!
June 14 It all started (for me) with just a small item on an Internet news page, "Trouble in the Kingdom". I thought they were talking about Disney World (the Magic Kingdom) so I clicked on it. Turns out they were talking about "the repercussions of curtailed social services in Saudi Arabia". (Insert a big yawning noise here.) So their kids don't get free day care? Big whoop. I scanned the article for any mention of M. Mouse and then went on with my life. My mistake. No biggie. Really.
June 15 Yesterday's headlines are still today's news? I guess those folks in the sand are really upset about something--it was in all the papers today. Sounds like the Saudi government is in for a tough time trying to rein in a runaway budget--and the locals don't like it one bit. Now their capital (Riyadh?) is a mess with people getting ugly in the streets. Yeah, yeah, yeah, no more subsidized housing. Deal with it, people. Get a job.
June 16 I saw the news today, oh boy. Three Saudi cities are up in flames, people with big guns are going nuts, and everyone that can find a plane is leaving that country in one big hurry. It's like Saigon in a sand box. (Not that I actually remember Saigon.) Local news guys are talking about what it means to us--and our oil. Maybe I'd better go fill up the car before everyone else does. I hate being stuck in long lines.
June 17 Almost forgot to top off my tank. Would have forgot completely if I hadn't heard the guy talking about it on the radio on the drive home from work. The gas station was busy, but not bad. Of course they'd already raised their prices. The creeps. Some people will try to make a buck off of anything. The radio guy said something about us sending in the Marines. Sure. Why not? How many countries can we invade at once?
I don't know, it really seemed kind of tame to me. The author talked a little bit about some mild altercations at the gas station and grocery store and about a few people trying to steal the bike but that was about it. In the story it seems that, for the most part, people obeyed the rules, did what they could to survive, and just "put up with it". I don't think people will, for very long, put up with the lack of: food, water, electricity, gas, transportation, communications, security, money, and all other goods. We live in an age of entitlement. The more entitlements the people lose, the greater their rage. Rage is also contagious and when "it" pops, the rage that these people had been bottling up will all pop at the same time. It will be ugly.
The author was right, though, in how so much of our lifestyles are based on cheap and abundant oil. It doesn't take much to upset the balance. We are already seeing the Middle East in chaos so this type of scenario may play out very soon. I pray that it doesn't but if our oil is cut off I pray that things don't go half as bad as I think they could or even as bad as in this story.
Thanks for posting the link to this story. It was a good read. I'd like to read more like it.
In case you haven't read it yet, there is a non-fiction version sort of like this <here>. It is a journal a guy kept during the Argentinian hyperinflation in the last decade. It is long but very sobering. It is a must read for anyone wanting to know how to survive in urban anarchy.
I think the whole "rage" thing is way overstated.... all that gun carrying hype in the US is just way over the top for me, I don't think any of it is really necessary. We've just had several disasters in a row here in Australia, biblical floods, devastating cat 5 cyclone flattening everything, bushfires, you name it.... if there is a god, he/she hates Australia! But there was no rage. Friends of mine only just had the power reconnected after 17 days off. Yeh, they're pissed off, but there was no rage. There was no food on the supermarkets for quite a while, no rage, and without power, the servos couldn't pump gas either. Still no rage. There was a bit of looting, but the cops dealt with it quite efficiently I believe. People just pull together in times of adversity, and I'm hopeful that's what will happen WTSHTF...
I was interested to see how "Sixty Days" starts off with mayhem in the Middle East considering what's going on over there now..... and I might poit out that the only time rage occurs even then is when the authorities respond badly with rage of their own. So, so long as the government doesn't lose the plot and comes out shootin', I don't think rage will be such a great issu.
But it is high time that governments everywhere came out with the truth and warned everyone we are screwed and this is as good as it gets.... that would avert a lot of rage too.
No, it's just that. Hype.
My possession of a weapon is a silent committment to defend anyone around me as if they were my family. Granted, not everyone shares the mindset, but only a fraction of a percent of the U.S. population actually carries a weapon anyway.
If you look at the relative danger of firearms, you'll see you're far more likely to die in a car accident, or due to medical mal-practice. Even weighing the frequency of these things, guns role in destabilizing culture is drastically over-publicised, and I'll bet they account for drastically more security than outright violence.
That said, I agree that 60-days was more realistic. I think the idea that National Guardsmen are going to be executing traitors on Obama's orders is pretty uninformed. More likely than not, we're going to be 'underwhelmed' with how slow and steady the collapse is. The rapid shifts are the dangerous ones.
Just imagine living in the third world. There will be Argentinas, Sierra Leones and Panamas. I don't think any "blanket" scenario would cover the entire U.S., with all its socio-economic and cultural variety.
Everyone's experience will vary.
Ok first of all, Australians are generally nicer than Americans, except on the football field, then they get as mean as anything =). But seriously, what has happened in Australia has been a large hiccup in the way of life but I think everyone there expects things to return to "normal". Americans have had their fair share of mega-disasters and have pulled through and even shined. Americans have even stepped up when other poor countries were hit by tsunami, hurricanes, earthquakes, etc. The rage comes when the average person wakes up and realizes that his way of life has come to an end, that he no longer has access to the basic necesseties of life and survival mode kicks in. He will rationalize and blame everyone else to justify whatever he must do for he and his family to survive. Go back and read the link to the Argentinian disaster I posted above to see how a real "Westernized" country deals with this kind of adversity.
I saw a perfect example of mass rage when I lived in Los Angeles in 1992. There was a group of people in the poor, urban areas that felt oppressed by the local law enforcement and government, and after the Rodney King verdict decided they'd had enough and lost control. Others in the area who weren't as closely affected by the verdict or law enforcement were mad too. They didn't know why they were mad, they just knew they were mad. When they saw the rioting on television and all the smoke on the horizon they also snapped. I had personal friends, friends who I considered to be upstanding citizens, decide to go down and riot and loot too. The whole thing got out of hand like a firestorm. It even infected cities all over the country with smaller riots. It only took one criminal verdict to set it all off. Today, 19 years later, those neighborhoods still haven't recovered.
I sure hope you're right about humanity pulling together in times of adversity. I pray that will be the case. I just want people to understand what could conceivably happen, I'm not saying that it will, just that it could. I believe people should prepare for the worst but plan for the best. Otherwise, what's the point in living?
So is anyone starting to feel the heat yet? I like fast food, and especially McDonald's, as barometers for the cost of living. In 2008, when I started my current job in this area, where I also go out to eat for lunch everyday, a typical meal was about $5.50 and it wasn't impossible to get a meal for under $5. I have noticed lately that it is difficult to get a meal for less than $7.50. That represents a 30-40% increase in 4 years. My salary has only risen 1.5% in that same time.
I believe this is just the beginning and the pressure cooker of the economy is about to erupt. Raw commodities are the first to react the effects of monetary inflation as they are stricly market driven and have no soul. However, businesses do not like to pass on higher prices to their customers for fear of losing their customers and so will sacrifice profits as much as they can afford before raising their prices and will only raise them as much as they think they can get away with. Still, the businesses at the start of the supply chain will react fairly quickly to the change in the commodities prices.
The businesses that sell directly to the public, however, have it the worst. They are very reluctant to raise their prices. They know the average consumer has choices: they can shop elsewhere like Walmart, cut back on luxury expenditures, eat out less, etc. The businesses that rely on these customers have so far been helped by their suppliers stealthily reducing the size of their products and/or using inferior materials or ingredients. Now that they've played that card there is nothing left but to raise prices. And they have raised them to some extent, as I said in the beginning of this post, but I believe they have been holding back and lowering profit margins as much as possible. They are dying to raise their prices more to cover their supply costs and get their profits back up but they are scared to.
What they need is for the general population to "accept" price increases. Once you hear on the everyday news about rising gas prices, rising food prices, rising, rising rising.... That is when the pressure valve will be released and most businesses will work together to really hike prices up to where they need to be. This is when it all begins and starts the cycle of hyperinflation. As I've said in other posts, hyperinflation is not a monetary event but a sociological one.
Unfortunately, I have lately started hearing reports on TV and radio about rising costs of everything on a regular basis. I expect by election day inflation will be the number one topic in all debates, by a long shot. By then all businesses will be raising their prices but I expect no increase in pay from my employer between now and then or even anytime after that. The candidates will all make promises that they can fix it but they will be powerless. The only things they can do are to either let the whole thing collapse and go into the worst depression the world has ever seen, or continue to throw money at the problem, perpetuating the cycle. This is not new stuff. It has happened over and over and over throughout history with all fiat currencies and it is happening here now.
I don't know exactly how life will be. Maybe it will be like my original story or maybe it won't. But it is safe to say that it will be extremely unpleasant for everyone, including the rich. The reason for constantly bringing this up is to remind everyone how this will sneak up on most people and they will be completely unprepared for it by the time they realize what has happened.
Even having known it was coming, it is a wake-up call when a couple personal calamities (dental, car problems) coupled with slow business bring it to your doorstep all at once. I have always been thrifty but have a new-found appreciation for food sales flyers and go crazy trying to decide whether to purchase something that I don't currently need (i.e. a coat a child could grow into) because the price is still far below the value.
But I continue to be amazed at how many people still do not foresee it getting worse and in fact say the tide is turning (for the better.)
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